Sunday, 10 January 2010

Playing with fire

One of the consequences of the large current account surpluses being run by developing Asian economies - see related posts here and here - is that these countries have an increasing pile of foreign exchange they need to spend. Add to the fact that some of these countries have, let's say, a tenuous grasp on liberal market economics (let alone western democratic civil liberties) and we get some interesting stories. Like this one:

TWO senior Qantas employees prevented from leaving Vietnam after financial losses on fuel markets have done nothing wrong, Qantas chief executive Alan Joyce said in Sydney yesterday.

Jetstar Pacific chief operating officer Daniela Marsilli and chief financial officer Tristan Freeman were refused permission to leave Vietnam on December 19 and are being investigated over losses linked to a practice known as fuel hedging.

As a main board director of a publicly listed company could you place your employees at risk of such behaviour from your supposed co-shareholders or business partners. I for one would feel that I had some responsibility for employees not being treated in such a fashion.

Should boards be factoring in their responsibilities in these areas and potential risks to themselves if nothing else before they get into bed with such unusual capitalist bed fellows?